Roblox tests the metaverse's potential after lockdown

The virtual-world building platform has become a closely watched company with big ambitions to connect a billion people, but the challenge as it’s understood in the public imagination is how it will cope now that real life is opening back up.

Why it matters

Roblox is one of the leaders of the emerging metaverse space, given that it’s one of the most tangible examples of what a series of interlinked worlds and value systems will look like. It is a platform for players and for creators and was a huge lockdown hit, increasing its already considerable popularity.

What’s going on

The company’s Q4 and full-year 2021 results caused its stock price to fall despite showing growth (albeit not quite the growth that investors had expected). This was always going to be a difficult period following an anomalous period in lockdown.

Weekend usage remains strong, but weekdays are seeing less traffic as social distancing eases. “It’s incredibly difficult to compare with a period where everything was shut down,” noted CFO Michael Guthrie.

Opportunities

Markets expect more of the same following strong periods of growth, but Roblox is making significant progress toward a more consistent business.

• Users are getting older, and Roblox is working with brands like Nike, Vans, and Gucci on a wider array of experiences to attract older, financially independent people.
• Bookings growth – the term for the amount of money spent by users on the game’s virtual currency – stood at 28% in the autumn quarter, which tends to feel the impact of back-to-school seasonality.
• Daily active users in January are 54.7 million, up 32% from January 2021. However, bookings per DAU were down slightly ($13.49 from $13.73), but the company says this is about a demographic shift.
• Developer revenues grew 119% year over year to reach $538.3 million, which is a key metric for a company trying to build a platform for the next phase of the internet: it needs to have developers making experiences.

Sourced from Roblox